Mining and minerals: can't live with 'em, can't live without 'em - Oct 29

Published by Energy Bulletin on Fri, 10/29/2010 - 07:00

Original article:

by Staff

German Industry Feels Rare-Earth Metals SqueezeStaff, Spiegel
Worries over a bottleneck in rare-earth metals from China, which are needed in the production of high-tech equipment, have dominated a conference on raw materials in Berlin this week. Beijing says export quotas are almost filled for the year. German Economics Minister Rainer Brüderle has called for more recycling and greater cooperation between the EU and the US to fill the gap.

German Economics Minister Rainer Brüderle told industrial and financial heads in Berlin on Tuesday that Chinese restrictions on rare-earth metal exports have started to weigh on the German economy.

"Germany is dependent on imports for most industrial materials," Brüderle said. "That impacts us currently in regard to many metals and energy supplies. But it also impacts us in rare earths that are essential for high-tech industries." The Economics Minister spoke at a conference organized by the Federation of German Industries (BDI), which included representatives from the European Union, the World Trade Organization and the World Bank.

Most of the current world supply of rare-earth metals is mined in China, which says its export quotas for the year have almost been met. The resources are indispensable in high technology, where they are essential to the operation of hybrid vehicles, high-performance magnets and computer hard drives. Some 95 percent of metals such as lanthanum and neodymium are mined in the People's Republic, giving Beijing a virtual monopoly on these resources. The Chinese have no intention of exporting these materials without demanding substantially higher export tariffs. China reportedly even wants to prohibit export of some rare-earth metals completely by 2015, prompting observers in Japan to describe the valuable resources as a "21st-century economic weapon."...
(27 October 2010)

The country produces more than 90% of these valuable commodities, which are used to produce electronic items such as mobile phones.

A row has blown up surrounding their availability, with relations between China and Japan at its centre.

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Concerns over shortage of rare metals
US and EU voice rare earth fears
The US and the EU asked Beijing to clarify its policy on mineral exports after China stopped shipping to Japan.

The stoppage followed a spat between China and Japan last month over islands whose ownership is disputed.

A spokesman for China's Ministry of Industry and Information Technology, Zhu Hongren, said: "China will not use rare earths as a bargaining tool. We will have cooperation with other countries in the use of rare earths, because it is a non-renewable energy resource."...
(28 October 2010)

Revealed: how deep-sea mining could destroy the 'cradle of life on earth'Tom Levitt, the ecologist
As Papua New Guinea gives go-ahead to a Canadian mining company to dredge its coastal seabed for minerals, critics say environmental assessments have been inadequate, local objections ignored and new species of life could be extinct before they have even been discovered

Deep-sea hydrothermal vents systems may be where life first evolved on earth
It was perhaps only a matter of time before mining the deep seas took off. Following in the footsteps of deep-sea fishing and drilling for oil it has been lurking in the minds of exploration companies like Nautilus Minerals, which is behind a major project in Papua New Guinea (PNG).

The idea of digging up the seabed one mile beneath the ocean surface to extract mineral-rich deposits such as copper and zinc first emerged in the 1960s. An initial flurry of interest in the 1970s was put off by low metal prices and UN regulations that exist on exploiting resources in international waters.

But with rising demand from China and India for rare earth metals like copper, and deep-sea surveys having now found concentrations of minerals four to five times those on land, it has returned but this time in the ‘unregulated’ territorial waters of PNG, conveniently close to the Asian markets.

Ecologists say the PNG government is allowing Nautilus to go ahead with the first ever commercial deep-sea mining project without properly considering the environmental impacts or local opposition. Nautilus investors include the mining giant Anglo-American which is ignoring indigenous opposition to a gold and copper mine in Alaska.

Exploitation or financial gain?

...‘I don’t think the project would be allowed to proceed anywhere else in the world based on such a poor analysis of risks,’ says Steiner. The USA is known to have similar deposits off the coast of Washington as has Canada but mining is not thought to be imminent. Dr Fujita suggests Nautilus is just the latest overseas mining giant to take advantage of lax regulations in the country. ‘In PNG they have a poor record of mining on land resulting in lots of poor conditions and that bad record and lack of oversight is now moving from land to sea,’ he says.

Only this week the PNG government was accused by Greenpeace of allowing rampant logging and failing to respect the rights of indigenous groups who depend on the forests.

Nautilus has reportedly suggested the country would benefit by more than $200 million from the mining but Steiner says the benefits to local people or the economy of PNG were likely to be disproportionately low compared to the scale and risk of the project. ‘While the project could gross almost $1 billion USD in its 30-month lifetime, it expects to provide only $41 million in total taxes and royalties to the government, a $1.5 million development fund and a few dozen jobs at most to PNG nationals,’ he said.

Prof Steiner is also acting as a science advisor to Mas Kagin, a group formed in 2008 to give a voice to coastal indigenous people in PNG oppose any commercial mining. The group says it depends on the coastal waters for their ‘livelihood, culture and way of life’ and has a right to oppose the seabed mining. In a campaign video community groups from two provinces expressed their fears. ...
(28 October 2010)

China rare earth quota prices up as exporters jostleLucy Hornby, Reuters
Limited quotas to export rare earths from China has driven a secondary market where the price of the permits are higher than the price of the minerals themselves, a Chinese industry expert told Reuters.

China sharply cut quotas to export rare earths in the second half of this year, after leaving them unchanged in the first half, catching international traders off-guard. Only a few authorized exporters still have quotas left for shipment.

The shortage -- and cost -- of quotas has helped drive smuggling, said Tiger Pan, managing director of Beijing-based metals pricing service Asian Metal, in an interview with Reuters Insider.

Smuggled outflows could exceed 30,000 tons this year, he said. He said the Ministry of Commerce estimates 20,000 tons of rare earth material were smuggled out of China in 2008.

That would augment legal supplies exported through quotas, which were cut to about 30,000 tons in 2010 from about 50,000 tons in 2009...
(29 October 2010)

Rare earths row: some home truthsPeter Foster, The Telegraph
If you haven’t heard of rare earth metals, then brace yourself – in the coming months you’ll be hearing a lot more about these 17 metals from the middle of the Periodic Table with unpronounceable names like lanthanum and neodymium.

They are sprinkled in a vast number of the things that make the modern world go round – from iPods to windturbines, electric car engines to flat-screen TVs and smart-bombs – and as such, they are vital to the global economy.

The reason you’ll hear a lot about them is 1) because China currently controls 93-97 per cent of the world’s production of rare earth metals and 2) because China is enforcing strict new quotas on the exports of rare earths which is pushing up global prices sharply.

China has actually had pretty well total control over rare earths supply for nearly a decade without anyone taking much notice, but the combination of the new quotas and deteriorating relations with Japan (over that fishing boat incident) and the US (over currency, trade and a recent investigation into Chinese government subsidies to its green tech industries) has brought the issue to the fore.

This is a very complicated story which I’ve been researching in detail of late, so there are a few things worth bearing in mind amid the hype.

1) There isn’t a shortage of rare earths....

2) The current rise in prices, which is built partly on hype and market fears, is already driving the search for new resources and is likely to be temporary....

3) There are valid strategic worries about China having such dominance of the rare earths supply chain, but the unpalatable truth is that West only has itself to blame...

4) And that price could be high...

5) China does have a valid point in this debate....

6) However China is not blameless....

7) China is arguably handling this very sensitive issue rather clumsily...

8) Lastly, several (dispassionate) analysts within the industry that I’ve spoken to in recent weeks, say that rare earths have been too cheap for too long...
(21 October 2010)

News special: Vedanta victory masks threats to indigenous peopleEmily Shelton, the ecologist
Following the landmark decision by the Indian government to prevent Vedanta from mining on tribal land, the Ecologist reports on the other tribes - including the Penan in Sarawak and the Guarani in Brazil - facing similar threats but being ignored by the media

The Indian government’s recent decision to ban Vedanta Resources from mining on sacred land belonging to an indigenous community came after months of pressure from campaign groups, extensive media coverage and unprecedented levels of opposition from a variety of quarters.

Despite the victory for the Dongaria Kondh people, an alarming number of other indigenous communities across the world are now under serious threat from mining, logging, cattle ranching and other industrial activities, The Ecologist has established.

Campaigners say that greater media coverage of these often unreported case studies could boost the chances of indigenous people's successfully defending their land from enchroachment.

Earlier this month the British owned Vedanta’s plans to mine for bauxite in a remote part of eastern India were halted, but not without a fight. The Indian Ministry for Environment and Forestry found Vedanta found guilty of violating the human rights of the local communities, but had to thrash it out first with the state government who originally supported Vedanta in its plans. Activists argue media exposure of the plans and suspected impact may have helped push the government to make a decision...

...In the Malaysian part of Borneo, the Penan people of Sarawak are in a race against time to get their rights recognised as their forests are cleared for logging, oil palm plantations and hydroelectric dams. The Sarawak state government, which does not recognise the Penan’s rights to their land, is allowing large-scale commercial logging on the tribes’ territory and is now planning 12 hydroelectric dams. The Penan have resorted to making human road blocks and risking prison to protect their rainforest.

...Evicted from their land in the middle of Central Kalahari Game Reserve in 2002, after diamonds were discovered there, the Bushmen of Botswana won the right to return in 2006 but are still fighting for their basic right to water. In June 2010 a judge ruled against them accessing the borehole they used before they were evicted; they are now appealing this decision and face more maltreatment as demand for diamonds increases. Survival International warns ‘diamond exploration was put on hold during the recession but plans are now going ahead with the recovery in price for diamonds.’

...In Brazil, the Guarani tribe is rapidly depleting from violence, assassination, overcrowding, starvation and now suicide as their land is stolen by cattle ranchers.

Survival director, Stephen Corry, told The Ecologist: 'The situation of the Guarani is appalling - it's one of the worst faced by indigenous people in the whole of the Americas. The violence, racism and abuses they experience are a result of the Brazilian government's failure to resolve conflict with the ranchers who have taken over their land. The assassinations, the suicides and the deaths of Guarani children from malnutrition will continue unless rapid action is taken to get the Guarani back on their land. It is a crime on an enormous scale.'

...Governments are benefiting financially from the situation. In the case of the Penan ‘it is well known the state is profiting from logging,’ according to a Survival International spokesperson. This was a similar situation faced by the people of Dongaria Kondh where the state government seemed to be supporting Vedanta for economic reasons.

In addition, indigenous tribes are facing some of the world’s most powerful corporate bodies and institutions. The Norwegian government is one of the biggest shareholders in the controversial Indonesian logging and palm oil group Sinar Mas. The Church of England was revealed by The Ecologist as being a major investor in Vedanta before pulling out earlier this year. While governments and banks continue with their plans and invest in mining, logging and dam construction there seems little hope development will stop, or the rights of local tribes will be protected.

Peter Jones said it takes a ‘near superhuman effort’ on the part of the indigenous communities, NGOs, and local activists to halt these projects. The media can play a vital role....
(6 October 2010)